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AP’s NewsRight and why it’s destined to fail

Yesterday, Poynter reported that the Associated Press and 28 other news organizations have launched NewsRight, “an ambitious venture to license original news content and collect royalties from aggregators.” Ambitious is right. The fact is, articles no longer have significant monetary value; otherwise, a system like NewsRight wouldn’t need to exist. AP and other legacy media organizations are trying to reverse a trend that’s irreversible.

At the same time as I read AP’s announcement, I was also reading Clay Shirky’s prognostications on what 2012 will bring for newspaper paywalls. One of Shirky’s main points is that newspapers and other content creators are having a difficult time transitioning from the paper being the product, to the article being the product. But the shocking reality to many journalists is that the article never really had any inherent value. Its value was implied, by being inexorably tied to a closed distribution ecosystem. Now that everyone effectively has a printing plant in their Internet-enabled computer, the article is exposed for what it is: something that has immense societal value (if the reporting behind it is well-done) but little monetary value.

Philosophically, I can see why this set of facts is disturbing to reporters. They put immense effort into newsgathering and understandably expect a reward at the end. But one of the reasons I decided to leave journalism is that the return-on-investment of my time versus the payout in the end wasn’t worth it to me. It doesn’t mean that it won’t be for some reporters. And by payout, I don’t even mean a monetary payout; I just mean that a reporter can spend hours, even days, gathering information for a story that might only be a few hundred words — or, at worst, end up on the cutting room floor. That’s life, though. The effort expended on something has no correlation with its reward in the end. It’s a reality that journalists now have to face, and no amount of propping up the value of articles by paywalls or licensing systems is going to change the fundamental economics.

I’m saying all of these things as someone who ranks very highly on Shirky’s “God Forbid” index. (“God forbid the Sun-Times not be around to keep an eye on the politicians!”) I still get the New York Times in print form every Saturday and Sunday, and I will probably continue to do so as long as they make a print product, because I love the medium. But I also see myself as an anomaly, something many journalists don’t. “Porous” paywalls, like the Times’, are made to monetize the 2% of people who are news junkies, not the other 98% who will never reach a 20-article-a-month limit. And I see no way to pay a newsroom — yet — out of that 2%, unless it’s a very, very small newsroom.

Interestingly, in his kicker, Poynter reporter Rick Edmonds ultimately shows himself as someone unable to see the economics of the article. He comes down on the side of AP, expressing in his own way the Rupert Murdoch-style “thundering against news aggregators”:

The venture will likely be greeted with derision or yawns by the digital intelligentsia, who have long decided that fences around content are retro and futile with the Internet providing users so many avenues to free news access.

He, and other journalists, need not worry about the digital intelligentsia (presumably he means the FON Junta) deriding NewsRight. It’s an idea that’s destined to fail all on its own.